Wednesday, April 26, 2006

Offshore Outsourcing Satisfies

A new survey conducted by the Weissman Center for International Banking at Baruch College and The Paaras Group (TPG) found that offshore outsourcing (simply called "offshoring" in the survey) is working for many adopters.

The survey canvassed 38 adopter companies (30 from North America and the remainder from Europe), of which over 60 percent were banks and financial services companies. Half of the entire sample space was constituted by companies with more than $5 billion a year in revenues.

Most (85 percent) of these companies are involved in IT offshoring, with 36 percent outsourcing contact centers and 40 percent offsourcing business processes. Although the tendency is to think of offshoring as a relatively recent phenomenon, over a quarter of all surveyed companies have been involved for over six years. There were no offshore call center adopters, on the other hand, who had that length of experience.

Regardless of the offshoring model, the surveyed companies reported an 89 percent satisfaction rate (with 43 percent satisfied "in a major way"). Furthermore, 89 percent also plan to increase offsourcing (65 percent "in a major way"). A total of 93 percent of respondents believe that offshoring has grown, while 61 percent believe that the quality of offshoring has improved.

The survey affirms that the primary (94 percent) motive behind offshoring is cost savings; however, no less than 63 percent of companies said it was about accessing skilled resources and 51 percent cited improving quality.

Specifically, making offshoring work involves setting up a program management office (85 percent) which broader success factors involve knowledge transfer (76 percent) and internal commitment (also 76 percent).
For details read here.